Globes, CPA Attorney Shai Einat 26.06.2020
Following the increase of the purchase tax rate in June 2015 with the purchase of another dwelling to 8% of the price, various and different tax plans have emerged to work around the sector. The most notable of these is the conclusion of a financial agreement between married or well-known spouses. What used to be an obscene term and even canceled weddings has become a powerful tax-saving tool.
The source of the matter is a precedent of the Supreme Court case in the Yigal Shalami case (CA 3178/12), issued in 2014 and reversed a previous ruling by the Supreme Court (Ann Mary Hebrew Case 3489/99) and held that In the man, a woman and their children have one "family room" for the purpose of housing, even if there is a financial agreement that stipulates complete property separation in relation to the apartment they came into contact with.
In the Shalami case, the court held that the possession of the family unit provided for in the Real Estate Taxation Law is contradictory by the couple, in the following two conditions: A - a financial agreement that determines the property separation between the couple. B - Proof that the parties maintain the actual property separation, for example, by a separate bank account for each rental partner, repaying their mortgage separately, sharing a single dwelling in the separated apartment and demonstrating how the purchase of the separated apartment was financed.
The ruling also encouraged married couples for many years to make a financial agreement - a move that may not even be legitimate. Therefore, a praise tax administrator carefully examines every claim for property separation and in quite a few cases even rejects it. I will give as an example two extreme cases that have come to an end.
Case 1: Prenuptial agreement after 30 years of marriage
Haifa District came to the interest of an employee of the Haifa Real Estate Taxation Office (AP 15786-01-17, 25.03.19) - no less. An employee of a previous apartment lived in her husband. Her husband lives in this apartment, and even had three children, in 2015. The parties signed a financial agreement in 2015 stating that the wife's apartment belongs to her alone and the husband's apartment belongs to him. He wanted to see her as a single apartment.
The court was impressed that the signing of the financing agreement came solely to save a man a purchase tax. Therefore, it was inconceivable that the honorable couple did not find time during the 30 years of marriage to sign a prenuptial agreement and were reminded to do so the day before purchasing the condominium.
Case 2: One and a half year agreement after selling an apartment
Another example is the Toister affair (PA 721-09-15). The name was a couple who married in 1985 and made a financial agreement in relation to the apartments they had before marriage - to Eliezer apartment in Givat Yoav and Miriam apartment in Jerusalem. capital gains tax.
a year later, earlier than four years from the sale of the apartment by Mary, sold Eliezer apartment he inherited in Safed, and requested exemption from capital gains tax in the sale of a residential apartment once every four years. Commissioner decided that it is in a family that one must deal for capital gains tax from the sale of half The apartment in Safed.
After a verdict was given on Shlomi in the Supreme Court, the couple made a financial agreement in relation to the apartment in Safed which, as mentioned, had already been sold a year and a half earlier! Following the agreement, the husband applied for an exemption. The application was rejected by a praise tax manager and the husband filed an appeal. The appeal committee also rejected the appeal, on the grounds that the agreement was excused for tax planning reasons, since: the agreement was signed retrospectively, about a year and a half after the sale of the apartment and after the entire judgment was given. In addition, the Appeals Committee stated that transferring funds between the separate accounts and the joint account indicates common economic conduct.